By buying EqualLogic Dell will strengthen its ability to simplify information technology infrastructures, especially as organizations look to store, manage and retrieve volumes of text and digital content, company officials said. Virtualization involves making a single physical resource ' a server, an operating system, an application or storage device ' appear to function as multiple resources, or makes multiple physical resources appear as one.

'Our customers will be dealing with the largest increase in data we have seen in our history over the next few years,' said Michael Dell, chairman and chief executive officer at Dell. 'Leading the iSCSI revolution will help Dell accelerate IT simplification and virtualization.'

Under the terms of the agreement, Dell will purchase EqualLogic for approximately $1.4 billion in cash. The acquisition of EqualLogic is expected to close late in the fourth quarter of Dell's fiscal year 2008 or early in the first quarter of fiscal 2009.

After completion of the transaction, Dell plans to grow EqualLogic's channel-partner programs with current and future EqualLogic-branded products. The company also plans to incorporate EqualLogic technology into future generations of the Dell PowerVault storage products.

EqualLogic offers the PS Series SAN, which provides advanced management capabilities that reduce the time and money IT staff spend on data storage. The company has more than 3,200 customers in 30 countries.